politipondhttps://politipond.wordpress.com
Domestic and International Politics in the Transatlantic CommunitySat, 23 Dec 2017 10:08:27 +0000enhourly1http://wordpress.com/https://secure.gravatar.com/blavatar/c4ec8b0f04afb8154d4a743f17bbe216?s=96&d=https%3A%2F%2Fs2.wp.com%2Fi%2Fbuttonw-com.pngpolitipondhttps://politipond.wordpress.com
Paradise Papers – A Story of the Disdain for Democracy by the Transatlantic Elitehttps://politipond.wordpress.com/2017/11/14/paradise-papers-a-story-of-the-disdain-for-democracy-by-the-transatlantic-elite/
https://politipond.wordpress.com/2017/11/14/paradise-papers-a-story-of-the-disdain-for-democracy-by-the-transatlantic-elite/#respondTue, 14 Nov 2017 20:40:43 +0000http://politipond.wordpress.com/?p=4188Continue reading →]]>

The “paradise papers” shine a light on the mechanisms utilized by global elites and corporations to avoid paying taxes. These latest revelations on the dark mechanisms of global finance, known as the “paradise papers,” emerge a little more than a year after the “panama papers.” But a clear distinction must be made between the two giant leaks: the panama papers were about illegal financial activities, while the paradise papers expose the legal financial and fiscal instruments available to the global elite and corporations.

Over a period of a year, 13.5 millions documents were analyzed and verified by the International Consortium of Investigative Journalists (ICIJ) and its 96 partners, such as the BBC, The New York Times, and Le Monde. These revelations are based on a leak of documents in 2016 shared to the german newspaper Süddeutsche Zeitung. This year long investigation has permitted to expose the complex mechanisms of fiscal optimization utilized by corporations and the global elite (see here the documentary by Vice on the investigation). The documents are composed of three major categories:

6.8 million internal documents belonging to the international offshore law firm, Appleby, located in Bermuda with branches in ten tax heavens,

566,000 internal documents from the law firm Asiaciti Trust in Singapore,

The paradise papers are particularly damaging for the transatlantic global elite involved in this massive tax evasion. The “paradise papers” are in fact the obvious demonstration of a total disrespect of democratic and social values by a segment of the transatlantic elite. As argued by an editorial of the french newspaper Le Monde, this mechanisms “endanger the principle of the equality of all in front of taxation.” Among them, so far the Queen of England, Elizabeth II, members of Trump and Trudeau’s entourages, and other wealthy individuals appear to have had prior or ongoing activities to avoid contributing to national taxation.

Politipond argues that the “paradise papers” are even more scandalous than the “panama papers” considering the current transatlantic political, economic, ideological and social climate. The “paradise papers” ought to be put into perspective along four points.

The first point ought to be political. The transatlantic political class has increasingly been more connected to, or simply is, the global elite. In the US, Donald Trump was brought to D.C. on the pledge to ‘clean up the swamp’ and on a variety of ‘America first’ slogans. Even though these rhetorics gathered great appeal on the campaign trail, the composition of his administration tells a completely different story. These latest papers show that three leading figures of the Trump

administration, Wilbur Ross, Secretary of Commerce, Rex Tillerson, Secretary of State, and Gary Cohn, Economic Advisor at the White House have or are utilizing these optimization mechanisms for personal profits. Other individuals and influential republican donors, such as Robert Mercer and the Koch brothers, appear in these documents. So far the most damaging allegations go against Mr. Ross, whom is potentially facing a conflict of interests, as he is still retaining “investments in a shipping firm he once controlled that has significant business ties to a Russian oligarch subject to American sanctions and President Vladimir V. Putin’s son-in-law.” This financial connection does not imply that Mr. Ross is a piece of the Russian puzzle involved in the meddling of the 2016 American elections. To the contrary, Ross’ spokeperson claimed that Mr. Ross has been supportive of the American sanctions against Russian entities. But this connection demonstrates an absolute lack of morality in the behavior of some members of the American elite and government officials. In a ‘normal’ democracy, Mr. Ross should have already provided his letter of resignation to the President (watch here Mr. Ross’ response).

The second point is economic. The Euro-Atlantic community has been confronting a considerable decline since the 2008 financial crisis. If the US has recovered quicker than European economies, the economic crisis has considerably affected a wide segment of the transatlantic citizenry. In both American and European economies, taxpayers were the one to fit the bill to bail-out, rightfully so, the banking and financial sectors in order to avoid a complete collapse of the transatlantic economies. But since then, the stock market, particularly in the US, has done fantastically well, while transatlantic wages for the middle class have stagnated. Unfortunately, strong financial data and performance have not translated into the real economy. Taxation is an important equalizing instrument in the hand of governments in order to finance the state and social programs among others.

The third point is related to ideology. These allegations contradict the push occurring in the US and some countries in the EU, lately in France with President Macron, to promote trickle down economics, meaning tax cuts on the wealthy, in order to promote investment. The concept/theory implies that income and capital gains maintained thanks to tax breaks and financial benefits to wealthy individuals and businesses permit to stimulate economic growth. This theory was, once more and recently, demonstrated as fantasy by the Kansas experiment.

In the US, the blame usually falls on the shoulders of the poorest and weakest. Elected officials have historically blamed welfare programs, such as food stamps, in order to explain the ever expanding deficit. In this case, the American elite is demonstrating that in a country wherein taxation is not the highest in the world, fair contribution via taxation is not as automatic as expected. The New York Times reports that “Americans — companies and people — dominate the list of clients.” Among these American corporate giants, Apple, Nike and Uber, have avoided taxes legally through creative bookkeeping.

Helping the wealthy getting richer through offshore maneuvers is not a “benign benefit,” said Harrington, a Copenhagen Business School professor. “When the rich get richer, the poor get poorer, because individual wealthy people are not paying their fair share of taxes.” The inequalities within the Euro-Atlantic societies are increasing and the gap is becoming wider between the ultra-wealthy and the middle class.

As illustrated above in the chart from an analysis published by Chicago Booth Review, the gap is not only wider, but the income of the bottom 50% earners has not increased in the last 34 years and the middle 40% only show a rise of its income by 42%. A 42% increase is not small, but compared to a 121% for the top 10 and 205% for the top 1%, it is quite minimal. In addition, over the last 30 years, the quality of the American welfare state has declined forcing Americans to increase their spending on their healthcare spending. Income inequality has considerable grown wider in the US since the 1960s. For instance, a recent report explained that “the richest 1% of families controlled a record-high 38.6% of the country’s [the US] wealth in 2016.”

Last but not least, the greatest consequence is social. Tax evasion, in this case legal, undermines that basic structure of Euro-American democratic societies. These directly undermine the basic ‘social contract’ and fabric that citizens have with their fellow citizens and governments. Taxation for too long has been framed as a punishment, when in fact it is an individual contribution, a civic duty, to the construction, physically and psychologically speaking, of the society, country and ultimately the defense of the public good. In a Western democracy, citizens are expected to contribute. But as it was demonstrated by the Trump campaign and rhetorics, a significant number of American voters agreed and supported a man proudly exposing his successful cheating (he has yet to release his taxes, which could prove the contrary). In an even more grotesque move, Mr. Trump pushed the argument further claiming that because he had successfully cheated, he would be the best person to ‘fix it.’

So far, we are only in the first weeks of the release of the documents. The “paradise papers” demonstrate the facility for the global elite to hide their wealth in all legality and impunity in tax havens through shell companies or other complex mechanisms. It is difficult to image Euro-Atlantic states pushing for an end to this legal loopholes, when states are increasingly in the hands of the global elite. “It won’t be lost on wealth managers and those in the offshore industry,” Professor Harrington said, “that we are reaching sort of French Revolution levels of inequality and injustice.”

In the case of Europe, the EU and other international organizations such as the OECD (listen here in French the recent interview of Pascal Saint-Amans, Director, Centre for Tax Policy and Administration at the OECD), have put pressures on offshore havens in order to reform their laws. As argued by Samuel White of EurActiv, the “paradise papers” may “provide the impetus the EU needs to finalise an effective tax havens blacklist and end tax competition between EU member states.” In the case of the US, the Congress has had no desire to address these issues in recent memory and the data in this latest leak demonstrate it. The Euro-Atlantic societies need to wake up and start pressing elected officials in order to tackle these systemic tax avoidance mechanisms. These inequalities are directly at the heart of the problem of the Euro-Atlantic societies seeking for alternatives in the extremes. Surprisingly enough, these allegations have not had the impacts as one would have expected. Impunity can only continue if the citizenry is consenting.

(COPYRIGHT 2017 BY POLITIPOND. ALL RIGHTS RESERVED. THIS MATERIAL MAY NOT BE PUBLISHED, BROADCAST, REWRITTEN OR REDISTRIBUTED WITHOUT PERMISSION).

Concerns that Iran may seek to develop its own nuclear arsenal once the Joint Comprehensive Plan of Action (JCPOA) expires in 2025 are legitimate. But how can one make an informed decision to decertify the deal when so far Iran has complied with the terms of the 2015 agreement signed under the UN auspice?

Politically speaking, Donald Trump, against the recommendations of his top advisors decertified the deal after having already recertified it at two previous occasions. While this decision may appeal a Trumpian base that perceives multilateral and diplomatic efforts as a form of weakness undermining American grandeur, a divide between the US and the Europeans is apparent regarding the survival of the Iranian nuclear deal. European counterparts, especially France, Germany, the United Kingdom and the European Union (known as the E3/EU), have not shied away from expressing their opposition to such unilateral decision by the White House.

Could the greatest threat to the unity and future of the European Union come from within the member states? For a long time, the concerns were coming from capitals seeking to leave the block, economic difficulties or even foreign pressures. With the 2016 Brexit vote, the national decision to exit the EU has in fact proven to foster unity among the member states on maintaining the integrity of the Union. But with the 2014 Scottish referendum (calls for a second referendum are being advanced), the movements within the nation-states to seek for greater regional autonomy, influence, and power from the national capital have been relentless.

The Catalan crisis is an illustration of a region seeking for independence from its state. The fraught relations between Madrid and Barcelona are real (read past analyses here and here). The crisis continues to escalate. Over the weekend, Prime Minister Mariano Rajoy declared that Madrid, the central government, would remove the region’s secessionist leaders. PM Rajoy announced the use of the Article 155 of the Spanish constitution, a radical step and an unprecedented event, which will dismiss the Catalan Cabinet, see Madrid assume all the powers of the regional executive, curb the role of the regional parliament and call for new regional election in the coming six-months. The central government does not seem keen at the moment to seek for mediation, but rather continues down the road of confrontation.

In addition, over the weekend, two wealthy Italian regions, Lombardy and Veneto, voted in non-binding referendums in favor of greater autonomy and seeking more power from Rome. These referendums, promoted by the Northern League ruling both regions, are not calls for secession from Rome, but instead a call for greater say and influence on issues of tax distribution and financial independence on several areas such as security, immigration and education.

Both Northern Italian regions contribute to a significant share of the Italian economy, with 20 percent for Lombardy and 10 percent for Veneto. Despite a significant share of Italian GDP, last summer Veneto received a €17bn rescue deal to address the banking crisis.

Even though it is too early to talk of a full fragmentation of some member states and the European Union, several trends and observations shall be advanced in order to rationalize and explain these forces at play. Prior to looking at a series of questions, which could contribute to the development of a series of hypotheses, one ought to recognize the complexities and particularities of each secessionist movements and the unique histories of the member states within the EU and their relationships with Brussels. These hypotheses try to identify commonalities between the recent movements in order to comprehend the reemergence of these regional forces.

Are wealthy regions done with solidarity via financial redistributions to other regions/states? Should the EU or the state be blamed for it?

Are these referendums informed by a conscious desire to guarantee cultural and linguistic survival, authenticity and uniqueness in a globalized world? This feeling is very much represented in Catalonia (despite being a major global touristic destination), in Nice and Corsica (France), and so forth.

Is the EU perceived as the enemy? In some regions of the EU, the EU or Brussels and in particular the Commission, are perceived as the actor promoting economic liberalism and ultimately undermining a certain savoir vivre. But in the recent case of Catalonia, the EU is called upon to mediate in domestic politics and national matters. Even further, there are some cases of desire to join the Union as a full member, which is a fantasy considering the responses of most European capitals and support to PM Rajoy.

The regional calculus takes for granted the core responsibility of the nation-state: national security and survival of the state. War and peace are forgotten concepts in Western Europe, which is quite ironic considering the state of European peripheries from the East (Ukraine) to the Mediterranean basin.

Are referendums the way to proceed in order engage with the central government? Do referendums serve the interests of the majority or only of the few?

Do these separatist movements inform us of a higher desire of activism and democratic inclusion? Meaning, there is a feeling of deposition to control civic life and influence the making of the nation. By scaling down from the national capital to the regional capital, there is a belief that one can have a greater say and influence in shaping the policy-making process and therefore the policy outputs. This democratic argument was very much present in the Brexit vote. These movements represent to some extent the end of centralized nation-states. But does this feeling of democratic inclusion at a lower level illustrate a narrow understanding of the world? It is not certain that an hypothetical sovereign Catalan state can, on its own, weather global forces from flow of capital to people.

@ Roland Brückner

Lastly, could we go even further and see these regional forces as the success of the European Union emphasizing that the state is now unable to fulfil the need of national citizens. In the case of Catalonia, the EU flag has been flown along the regional symbols. However, it is not certain that other regions would feel the same way. But if this were the case, the current EU would not be suited for the move towards a federation of regions considering that it is currently a Union of Sovereign States.

(COPYRIGHT 2017 BY POLITIPOND. ALL RIGHTS RESERVED. THIS MATERIAL MAY NOT BE PUBLISHED, BROADCAST, REWRITTEN OR REDISTRIBUTED WITHOUT PERMISSION).

With the election of President Macron in May and the guaranteed re-election of Angela Merkel, the European Union and the state of European affairs were supposed to return to the positive. Unfortunately, a series of recent events have exposed deep problems in Europe with the rise of AfD in Germany, the call for independence by Catalonia, the UK-EU tensions over the terms of Brexit, the election of Sebastian Kurz in Austria, and the recent assassination of a Maltese journalist. These recent events, prior to the European Council meeting on October 19/20 in Brussels, display domestic tensions and the need for greater unity at the EU level. But both seems incompatible at the moment.

Despite winning a fourth-term as Chancellor (past analyses here and here), Angela Merkel has yet to finalize the structure of her government. The strong results by the Alternative for Germany (AfD), extreme right party, was a response to Merkel’s Willkommenspolitik towards refugees since 2015. AfD capitalized on the fear associated to immigration and the perceived undermining of German identity. Chancellor Merkel is working on the coalition talk. On Sunday, Merkel’s CDU lost an election in the northern state of Lower Saxony to the SPD, which could affect her upcoming coalition talks. With the decision by SPD not to enter in a coalition with the CDU, Ms. Merkel will have to move towards the option of a Jamaica Coalition (with the pro-liberal and green party). The talks to form a coalition will be difficult considering the differences of policies and options on fundamental issues from immigration, EU reforms, taxation policies and environmental protection.

In the case of the UK-EU relationship as part of the Brexit negotiations, the current tension is centered around the financial obligations of the UK, or the net contributions of the UK to the EU’s budget in 2019 and 2020.

@ Olivier Hoslet/EPA

Until an agreement on the UK financial obligations is set, the EU is not willing to move forward regarding the terms and type of relationship between the UK and the EU post-Brexit. Prime Minister May changed the tone with her recent speech in Florence and confirmed that the UK will “honour commitments we have made during the period of our membership.” But the EU is expecting more concrete terms coming from the British leader. At home, PM May is facing a difficult front from the hard brexiters, framing the financial obligations as a ‘divorce bill,’ and members of her own party. She appears to have lost credibility domestically affecting her ability to shape a common position, and her European counterparts are concerned about her ability to stir the negotiations and ultimately deliver. Until the question of financial contributions is settled, PM May will not be able to move forward and discuss the terms of the future relationship between the UK and the EU. As reported by the Guardian, European leaders are the ones overruling EU chief negotiator, Mr. Barnier, whom suggested opening talks about the transition phase. But it appears that some European capitals are not ready to respond to May’s call. Ultimately, “the problem is not in the commission so you will not find the solution in the commission.” Therefore, the upcoming European Council will be critical for PM May to make a her case with as many EU leaders as possible.

On Sunday, Sebastian Kurz became one of the youngest elected leaders, at 31, as the Chancellor of Austria. Mr. Kurz, leader of the conservative right wing Austrian People’s Party (ÖVP), won the national election with 31 percent of the vote. The Social Democratic Party of Austria, which currently governs in coalition with People’s

@ David Sailer/FT

Party, received 26.7 percent, while the Freedom Party, extreme-right, had 27.4 percent. Traditionally, the People’s Party and the Social Democratic Party govern in a coalition, but this time, Kurz may be forming a coalition with the extreme-right taking the country back to 2000 when Jörg Haider led the country triggering political sanctions by the EU. Austria is one of the wealthiest EU countries with one of the lowest unemployment level and highest standard of living. But during the 2015-16 migration crisis, Austria took part of Merkel’s Willkommenspolitik welcoming a considerable number of refugees. During his tenure as Foreign Minister, Mr. Kurz, was behind the drive to seal the Western Balkan route in 2016 and was critical. The theme of the election, as it was the case in the other western countries, was identity, in particular anti-immigration and anti-Islamization. For instance, he has been calling for effective defence of the EU’s external borders, a stop to illegal immigration and curbs on foreigners’ access to welfare payments. “Anti-immigration populism and nationalism” wrote Steven Erlanger and James Kanter of the New York Times “are challenging the European Union’s commitment to open borders for trade and immigration.” In the coming days, Kurz will be building his coalition, but a move to the extreme-right appears as the new normal for Austria.

The continuous tension between Madrid and Catalonia represents a considerable crisis in one of the largest Eurozone economies (read two recent analyses here and here). After a referendum, considered by Carles Puigdemont, as a victory towards the independence of Catalonia from Spain, he has failed to call for it during his address to Catalan lawmakers on October 10. PM Rajoy asked Mr. Puigdemont to clarify his address by tomorrow (October 19). In case of a failure to comply, Madrid may use its emergency powers to take administrative control of the region by invoking the article 155 sending the country into a deeper political crisis. The tensions between Madrid and Catalonia continue to escalate despite a recent call by Mr. Puigdemont asking PM Rajoy to initiate a negotiation in order to find a solution.

Last but not least, Daphne Caruana Galizia, Maltese journalist, was assassinated on Monday in a car bombing in the smallest EU member state, Malta. She had made a name for herself exposing ramping corruption at every levels of the Maltese society and political arena. During the Panama Papers’ scandal, she exposed the link between politicians and shell companies. More recently, she uncovered financial dealings between family members of Azerbaijan’s president and Malta’s prime minister, forcing snap elections. Her assassination is latest attempt to undermining freedom of press and expression in Europe and it requires proper response and inquiry by the Maltese government and the European Union.

All these recent issues illustrate considerable challenges for the future unity of the bloc, but as well expose major systemic and domestic failures. These issues related to ethno-nationalism, populism, secessionist desires are ramping and require stronger domestic initiatives to shrink economic and social inequalities, address sub-national identity and cultural fears, and bring back a certain civility in the political discourse. At the EU level, these crises illustrate the a growing disconnect between Brussels and the capitals. Fascinating enough the EU is being criticized for being too little integrated on issues of migration and being too passive on questions of regional secession, but the EU does always not have a mandate to dictate policies and rules in certain areas of political life.

Each selected case exposes the undermining of core EU values from freedom of expression, to maintaining democratic values, inclusion, and ultimately the centrality of the rule of law. Austria is another piece of the European populist puzzle and highlight the shift toward the extreme-right. Hungary and Poland are the examples of the undermining of EU values and a clear shift towards non-democratic regimes. For instance, Hungarian Prime Minister Viktor Orban has championed what is refered as “illiberal democracy.” Austria illustrates that the East-West divide continues to widen. Populism is vibrant and spreading throughout Europe and it is shacking the democratic foundations of EU countries and the EU.

(COPYRIGHT 2017 BY POLITIPOND. ALL RIGHTS RESERVED. THIS MATERIAL MAY NOT BE PUBLISHED, BROADCAST, REWRITTEN OR REDISTRIBUTED WITHOUT PERMISSION).

Let’s get straight to the point: self-determination of peoples. It is a very laudable theoretical concept. All peoples should have the right to choose the nation they wish to belong to, especially when they have a distinctive culture and a different language, as well as political and economic viability to build an independent state. And we, Europeans, ex-colonialists, field with guilt for our ancestors’ acts, tend to favor the rebels, independently of the justice and the consequences of their cause.

Historical Rationales for Independence

But there is also the other side of the story: in his most recent book, Michael Walzer uses three case studies of the past, India, Algeria and Israel, whose legitimate claims of independence where much more consubstantiated, to prove that “liberation movements” do not represent the expression of the majority will (people are much more concerned in surviving and moving ahead with their lives in troubled times), but the position of a separatist elite who builds a narrative and does everything they can to convince the population that their intentions are fairer and their view of history is much more accurate than the one the status quo power has been trying to impose.

In practice the paths towards independence are sinuous and trapped. They are played in a dangerous arena where almost everything is admissible for the cause of independence. It is an opportunistic and dirty game where the two sides are waiting for a weakness of the rival. It generates violence. In more extreme cases, it generates civil war. In the most extreme cases, it generated ethnic cleansing. At the regional level it generates instability. Very often it is contagious to sleeping separatisms that start to reevaluate their possibilities. Of course, we think, nothing of this kind is going to happen in Catalonia. After all, it is the 21st century, and this is Europe. But let me remind you of two things: on the one hand, the two sides of the conflict, Barcelona, and Madrid, have already reached extremes that we never thought possible in a democratic context. On the other hand, the last few years have demonstrated that nationalisms, of the emotional, ideological, centrist, and extremist kinds are not a relic of the 19th century. They are alive and kicking. Remember that history does not repeat itself but it rimes. Nationalisms are back, now in a context, different from the past. And we, in Europe, are ill prepared to deal with them.

The Catalan Case

How did we get here? The Catalonian separatism has a long lineage. The national day of the region, September 11, is related to the events of 1714, when Barcelona lost its autonomy to Spain in that War of Succession. In the 20th century, the mores and the language were trampled violently by the bloody Civil War and then by Franco’s regime, trying with particular roughness, to dissolve the Catalonian culture. The collective memory of these events has been passed along generations, as the testimonies from Barcelona, since the mock referendum of October 1, published in the international press, have been claiming. The nationalist feeling was partially placated (ironically) by the 1978

Constitution, that inscribed the right to regional autonomies in the context of the “indissociable unity of the Spanish nation”. But, albeit Catalonia’s acceptance of the founding text of Spanish democracy, the relationship between Madrid and Barcelona was always ambiguous. The Generalitat has always tried to find ways to further autonomy, while the central government has always been keen on protecting its powers. But for considerable period, the regional government was in the hands of moderates. First, a right-wing coalition, the CiU was ahead of it (1978-2003) and then it was replaced by its left-wing equivalent, a coalition led by the PSC, the Catalonian branch of the PSOE (2002-2010). The radical separatists were relayed to the margins, namely ERC, a leftist republican party that tried an independence coup a couple of years before the civil war and the several anarcho-unionist groups, also very active before the war.

However, minority ideas tend to fall asleep but never die. And the Catalonian separatism woke up due to three main factors: first, the economic crisis of 2008, that generated a feeling of injustice as Barcelona profits (around 20 percent of the Spanish GDP) were redistributed to the poorer provinces; second, the judicial process moved by Mariano Rajoy’s Popular Party, between 2006 and 2010, that resulted in the removal by the Supreme Court of the status of “nation” (ambiguous) that had been approved in a legal local referendum. The SC alleged reasons of unconstitutionality and the PP claimed reasons of balance between unitarists and regionalists; and third, the political change in the composition of the regional government, that started to be ruled by the coalition “Together for Yes” (to the independence) that mixes, since 2015, the CDC of Carles Puigdemont, a right liberal party that became separatist as a result of the policies of the central government; the ERC, the republican independentist party of the 1930’s; and the CUP a left wing separatist movement composed by several small radical groups. Together they have qualified majority at the Generalitat, even though their only commonality is the independence of the autonomous region.

The Volatility of Nationalist Separatism

This change went relatively unnoticed, but aligns with the similar rise/growth of diverse populist movements across Europe (old nationalisms, new times). But this particular one has a different element: the nationalist separatism is a much more sensitive issue, more emotional, and capable of mobilizing passions. Which usually is a Molotov cocktail in politics.

The events that have been succeeding since October 1st are the culmination of all these tendencies: painful collective memories politicized by a coalition reaching the regional parliament thanks to protest votes against Madrid’s policies; all this in combination with a disastrous management of the Catalonian issue by the central government (including the King Felipe VI). Plus, Barcelona took advantage of the weakness of the chief of central government, Mariano Rajoy, who needed two general elections and almost a year to form a minority government.

This was the context of last Sunday’s referendum in Catalonia. Madrid had the law on its side. It forbidden the public consultation for reasons of unconstitutionality, but the Generalitat was more astute: it disobeyed, and dragged to disobedience more than two million citizens. Nothing was legal in the referendum: plastic ballot boxes, aleatory vote sites, on-line electoral lists of doubtful accurateness, and a very low affluence (around 42 percent) that indicates, according to specialists, that the unitarians simply did not bother to vote, considering the consultation bogus. These arguments would have been more than enough for Rajoy, with the support of Felipe VI, to declare the nullity of the act and move on. As it already happened in the past.

But Madrid lost its mind. So, it sent 12,000 civilian guards to preclude the voting. In this counter-information war, we know that the national police used force against the population (although we do not know how often), we saw mossos d’esquadra (the Catalonian regional police) crying and, according to hospital records, there were almost 900 injured (even though we ignore the extensiveness of the wounds). What remains from October 1st is the image of the Catalonian people enduring the police intervention against them in the name of independence. TV cameras from around the world captured enough images of disproportional violence to leave Madrid’s international image in the mud and to revolt thousands of Catalans that so far had been happy with the status quo. Rajoy, they say, is an “independentists’ maker”. And in fact, he is. In 24 hours he did more for the independence cause than all separatists together. In democracy, when one has the law and at least part of the legitimacy on their side the use of force against the population (who possibly believed in the goodness of the idea of independence) has two consequences: one loses the morality battle and the support of the population. The independentists won a double victory: they opened a larger gap between then and Spain (and Europe), very difficult to get over and they won the sympathy of the “international public opinion”. If this concept, popularized by Jürgen Habermas during the demonstrations against the Iraq war, is vague and imprecise, its practical effect is well known.

What next?

And now what? There are three possible scenarios. For now, the most likely is a growing tension between the parts, as Carles Puigdemont is likely to declare independence unilaterally this week and Mariano Rajoy has threatened to use all means at his disposal to stop him. It is difficult to predict the endgame of escalation. In politics there are few things as dangerous as separatist nationalism for reasons described above but too important to forget: internal violence, regional instability, and domino effect. Europe is full of separatist movements that might see the Catalan moment as an opportunity put forward their claims for self-determination and autonomy.

The second scenario is that Madrid and Barcelona overcome their differences and start to negotiate (as the population ask them to do this weekend in very large demonstrations). However, the possibilities are scarce and the conflict already reached a high point and depending on Puigdemont’s call a potential point of no-return.

Which take us to the third scenario: bringing in an external referee, a mediator. The successive crisis of the European Union almost made us forget that the main goal of its creation was to avoid that war would return to the continent. And it does not matter how critical each of us might be, the truth is this goal has been fulfilled (except for the Balkans that were Europe but not EU). We reached a critical point where Brussels should refashion its peace-making credentials. Pretending Catalonia is none of the EU competency is the sort of decision that did not pay off in several situations in the past. Let’s hope that Europe is willing to mediate, if called upon, this internal crisis, because peace in the continent must be one of the main values that unites member-states. And lastly, if something goes really wrong in Catalonia, a Pandora Box will be opened challenging the integrity of member states. The Catalan crisis could have greater unforeseen and unwanted consequences on the integrity of the EU than a bad Brexit.

Diana Soller is a research follow at the Portuguese Institute of International Relations (Lisbon) and a weekly columnist at the daily Portuguese newspaper Observador.

Politics in Europe are alive; Catalonia is the latest example. The financial crisis was the axiomatic moment in contemporary European politics fermenting domestic crises throughout and within the Union, occassionally bursting ever since. These crises have equally affected all EU Member States leading to the rise of nationalist forces (notably in France, the Netherlands, Austria, Germany, the UK, Poland, Czech Republic and so forth) shaping the national political rhetorics and policy-agenda.

The latest crisis is undeniably Sunday’s referendum in Catalonia, which exposes an absolute dilemma and threatens the integrity of Spain, one of the largest EU Member States and Eurozone members. In a European Union composed of 28 sovereign states wherein domestic politics remain in the realm of the sovereign states (unless under a policy-area of a European competence), one core commonality remains binding democratic values and principles. Catalonia is one of these cases wherein state sovereignty and regional call for self-dertmination meet and clash.

The Catalan Nightmare

The crisis in Catalonia has changed gear, and potentially seen a shift in legitimacy from Madrid to Barcelona, with the reprehensible response by the Mariano Rajoy’s government on October 1 ensuing the unilateral Catalan referendum. Prime Minister Rajoy had the law on his side as the Spanish constitutional courts have ruled on several occasions on the illegality of a referendum on the independence of Catalonia. But “Spanish Prime Minister Mariano Rajoy has transformed” argued Frederiga Bindi “what would have otherwise been a unilateral, unconstitutional, and useless referendum into a major victory for the separatists.”

Cartoon: Chappatte

The legal baseline is Spain 1978’s constitution, which stipulates that Spain cannot be broken up as “the indissoluble unity of the Spanish nation” and “the common and indivisible homeland of all Spaniards.” Only the Spanish Parliament can changed the constitution.

Catalonia is a critical piece of Spain, which is the 14th largest world economy and the 4th largest in the EU (post-Brexit). Catalonia counts about 16 percent of Spain overall population Catalonia is one of the richest regions of Spain contributing almost 20 percent of the Spanish economy. One of the arguments in favor of the independence is the lack of proportionality between Catalan contributions to the overall budget and the return. From the 20 percent of contribution, Catalan residents receive 14 percent back for public expenses. Economically, Spain may certainly face serious internal trouble if Catalonia were to secede.

Emilio Morenatti/Associated Press

Without going back to 16th century Spanish history, Catalonia has always considered itself unique and separate from Spain with its own history, language, culture and therefore nation. In contemporary Spanish history, 90 percent of Catalonia supported the 1978 constitution. But the separatist movement and feeling have always remained underneath. The recent financial crisis, shifting into the Eurozone crisis, leading to the near collapse of the PIIGS country counted Spain in the mix contributed to exacerbate the tensions between Madrid and Catalonia. Adding to the financial crisis, Spain’s constitutional court struck down parts of the new statue of autonomy for Catalonia in 2010. Since then, Madrid did not reach several opportunities in order to continue talks with the region.

Prior Sunday’s violence, polls were always consistent in proving that only 40-45 percent of Catalans have been in favour of independence. 2013 was the year with a peak in the support level at 49 percent. Prior the announced referendum on October 1, a majority of Catalans were in a difficult position between Catalan authorities to hold the referendum on independence and the strong-hold position by Madrid.

Mariano Rajoy of Spain called on the separatist leaders, behind Carles Puigdemont, President of the Generalitat of Catalonia, to stop the “disobedience” and the “escalation of radicalism.” In a rare televised speech on the evening of October 3, the King Felipe VI of Spain condemned the actions by the separatists framing them as illegal and infringing the legal structure of Spain. “They have tried to break the unity of Spain and national sovereignty” he went on to claim. Ensuing the banned referendum, Catalonia has announced that it will move forward and declare independence from Spain in the near future (after a parliamentary session on Monday). Legally, if a declaration of independence were to be made, the central government of Spain could suspend Catalan autonomy under Article 155 of the 1978 Constitution. Such option would bring the country in a major constitutional and political crisis.

And, the European project?

Where does the European Union fit in this complex political puzzle? The EU is indirectly the cause and the remedy. But it is as well, rightfully so, a reluctant actor. In the case of the Catalan crisis, the EU and its set of institutions have remained as distant as possible from this domestic crisis. For the EU, this is not only bad news, but a sign of major internal forces at play within Member States. “Separation and secession within a member state is very bad news for a block” argued Stephen Beard of Marketplace “that is striving to hold itself together and is currently doing its utmost to punish Britain for daring to break away from the EU.”

The Treaties of the EU are clear regarding the competencies of States and the EU. For instance, Article 4.2 of the TEU stipulates that, It [the Union] shall respect their essential State functions, including ensuring the territorial integrity of the State, maintaining law and order and safeguarding national security. In particular, national security remains the sole responsibility of each Member State.

Ensuing the use of force by Madrid on Sunday in Catalonia, the EU called out and condemned government violence against citizens. On October 2, the Commission released an official statement underlining the illegality of the referendum under Spanish law. Without directly targeting PM Rajoy, the Commission ended the statement by claiming that “Violence can never be an instrument in politics.” However, Spain may be one of the largest and Western EU Member State, the Commission must be as critical as it has been in Poland and Czech Republic. “It is the kind of violence the European Union” writes Steven Erlanger of the New York Times, “would ordinarily condemn in high moral terms and even consider punishing.”

On Wednesday, the Commission called for an open dialogue between the Catalan authorities and the Spanish government. Frans Timmermans, the Commission’s deputy head told before the European Parliament that “it’s time to talk.” Timmermans still maintained the official position of the Commission endorsing the legal position of Spanish Prime Minister Rajoy. During the European Parliament’s session, two leading MEPs, Bavarian Manfred Weber and Flemish Guy Verhofstadt emphasized on the fact “strong regional identity and autonomy did not mean breaking up existing nation states.” What is certain is that “if Catalonia were to leave Spain,” underlined Jonas Parello-Plesner of the Hudson Institute, “it would also leave the EU, only to start a cumbersome reentry process.”

EU Member States, all sovereign states, are not usually in favor of secessionist movements, especially within the Union. In the current context of the Brexit negotiation, the EU and the 27 Member States are quite reticent to see a region of a Member State calling for self-determination and seeking independence. “Throughout my life,” wrote Javier Solana, a former Spanish minister, former NATO Secretary General, and the first EU High Representative, prior the Sunday violence, “I have witnessed the fragmentation of many countries, and I cannot conceive of that happening in the European Union of today.” Despite the reprehensible past action and poor tactic by PM Rajoy, it is difficult at this time to foresee any support from the 27 European capitals for Catalonia’s independence.

Lastly, the Catalonia case brings home a reality, which seems to have been forgotten in one of the richest regions of the world: history tells us that states will use force to maintain their integrity and unity. In his address to the nation, King Felipe VI, “Today Catalan society is fractured and in conflict,” he said. “They (the Catalan leaders) have infringed the system of legally approved rules with their decisions, showing an unacceptable disloyalty towards the powers of the state.” The message is direct, the state shall remain and fight any types of fragmentation.

For decades, Europeans have watched separatist efforts in Iraq-Turkey (Kurdistan), Sudan (South and North), Serbia (Kosovo), Chechnya (Russia), Nepal (China) with a certain distance condemning state violence and believing in some sort of European exceptionalism, that it would not happen here inside the Union. Well Spain demonstrated a forgotten reality.

“As it forms the basis for an experience of freedom, the history of democracy,” Pierre Rosanvallon, Professor at the Collège de France noted, “is therefore not simply a history of frustrations or betrayed utopias: it has become a deeply intertwined history of disenchantment and indeterminacy.” The Catalan case opens the European Pandora box of a forgotten past forcing European citizens and leaders to reflect on the questions thought buried under the rumbles of World War two, but briefly emerging since with the reunification of Germany and the wars in the Balkans, of identity, democracy, power, oppression, nation-state, region-state and cohesion. The fraught between Madrid and Catalonia is serious and could have considerable ripple effects if a thoughtful and open dialogue is soon implemented.

(COPYRIGHT 2017 BY POLITIPOND. ALL RIGHTS RESERVED. THIS MATERIAL MAY NOT BE PUBLISHED, BROADCAST, REWRITTEN OR REDISTRIBUTED WITHOUT PERMISSION).

Angela Merkel won a fourth term at the helm of Germany ensuing the German federal parliamentary election. In postwar Germany, she is now one of the longest serving Chancellors after Konrad Adenauer and Helmut Kohl. Despite winning her fourth mandate and maintaining her status of most seasoned European politician, she is facing some serious challenges at home. Her conservative party, the CDU, scored one of the lowest results in recent memory and lost almost 1 million voters to the extreme-right anti-immigrant party, Alternative for Germany (AfD). Time will tell, but this general election sends a signal to Germany, Europe and the world: traditional postwar german politics appear to be changing. This election marks very well a substantial political shift.

Data and Political Landscape

The big story of this election is the rise of the AfD as the third largest bloc in the parliament with over 88 deputies, as it received 12.6% of the vote. As argued by Gideon Rachman of the Financial Times, “Germany now looks more like a ‘normal’ western country. And that, ironically, is not something to be welcomed.” The normality implies a Western country with a relatively strong presence by a extreme-right anti-immigrant party. Germany is not immune anymore.

The AfD was founded in 2013 in response to the bailout of the Eurozone economies. It was an eurosceptic party created by conservative intellectuals six months prior to the 2013 elections, led by a professor of economics at the University of Hamburg, Bernd Lucke, opposed to the bailouts by Germany of other eurozone economies. At that time, the party failed to make it into the Bundestag receiving only 4.6% of the vote, or 0.4 percentage points below the 5% cutoff. The 2015-16 refugee crisis leading to an open-door policy by Chancellor Merkel, welcoming over 1 million refugees, was used by the AfD leadership in order to shift the party ideology from eurosceptism to anti-immigration. The three figureheads of the party being Alexander Gauland, Alice Weidel, and Frauke Petry have used incendiary rhetorics and not shied away from addressing Germany’s nazi past.

With 32.9% of the vote, Merkel’s CDU won the night and a significant share of the Bundestag. However, it is a half-tone victory considering one of the worst results for the CDU losing over 8.6% of the votes compared with the 2013 general election. Furthermore, Merkel’s CDU saw the migration of roughly 1 million voters towards the AfD (see chart below). Merkel’s agenda throughout the campaign was mainly based on the concept of continuity. But the migration towards the AfD may not be only about immigration policies. Chancellor Merkel played a considerable role on making Germany one of the strongest world economies and the economic power of the European bloc. The reforms began in the 1990s, continued by Merkel, implementing neoliberal economic programs permitting to grow the economy, lower unemployment and averse the debt. For instance, four of the world largest companies are German and the country has one of the lowest unemployment level at 5.7%. But these policies came at a cost as the trade-off allowed a huge wealth to companies and low wages. Over the 12 years under Merkel, the disparity between the wealthy and the poor has widened and 16% of the population is at risk of poverty.

Arguable one of the major losers of the 2017 election is the SPD receiving its worst defeat since postwar with 20.5% of voters. In a four year period, the party led by Martin Schulz, the former President of the European Parliament, lost over 5% of voters. One of the major problems for Schulz, whom lacked strong domestic presence, was his inability to articulate a clear alternative to Merkel’s CDU. In addition, traditional SPD voters, its blue-collars base, is declining and represents roughly 19% of the electorate. This number almost mirrors the final results of the SPD at this election. In addition, almost half a million of SPD voters migrated towards the AfD during this election cycle. Schulz’s call to bring the party into the opposition, meaning it won’t join the coalition with the CDU, is no surprise. During his announcement, the SPD leader declared that “in a democracy the opposition is perhaps a more decisive force than the government.” The hope and strategy is to redefine the values, policies and ultimately ideology of the SPD for the next general election in order to attract more voters.

This illustration below provides a substantial and brief analysis of the Bundestag since the end of the World War two. As one can observe, the SPD-CDU have historically held a substantial majority until the 2017 elections. Last, as illustrated at the bottom of the illustration, a extreme-right party, the AfD, makes his first appearance in the Bundestag since postwar Germany.

Jamaica Coalition

In order to govern, Chancellor Merkel will need to form a coalition. The evening of results, SPD leader, Martin Schulz, called for the party to stand as the opposition and not forming a grand coalition with Merkel’s CDU. This leaves Merkel with the possibility to join forces with the pro-business Free-Democrats, or FDP, and Green party. This triumvirat is known as the Jamaica Coalition, considering that the colors of each party mirror the colors of the flag of the Caribbean island (Black, Green and Yellow).

The development of the coalition is a priority for Merkel, which will be a major challenge for the Chancellor. For starter, candidates of the FDP and Green party disagree on substantial issues and won’t be easily brought together. A “deal to form a coalition” writes Stefan Wagstyl “could take months to put together, given stark policy differences between the parties on several issues including environmental protection.”

The Jamaica coalition will affect the ability of Merkel to work with French president, Emmanuel Macron. The FDP agenda, as advanced during the campaign, goes in opposition with Macron’s proposals, as it opposes the French proposition to reform the Eurozone (i.e. creation of a European budget). On this point, President Macron will be announcing his vision for the reform of the Eurozone on Tuesday, September 26, as he was waiting for the official results of the German election. Ensuing his speech, FDP reactions will be critical for Merkel in order to define the terms of the coalition and therefore her future line with regards to European reforms.

Finally, Chancellor Merkel will need to deal with a growing opposition within her own party. For instance, Merkel is starting to see some opposition coming from Klaus-Peter Willsch, a conservative CDU, opposed to Merkel’s immigration policy. The dealing with the FDP and Green party will be challenging, but keeping in check her own party will be major dilemma.

German Political Realities and Beyond

Despite winning a fourth term and a clear mandate, the outcomes of this election cycle respond to Merkel’s most critical policy-choices: the bailouts of some of Germany’s Eurozone partners and open-door policies vis-à-vis refugees. Both decisions taken by Chancellor Merkel were the right one at the time (for the bailouts avoiding a collapse of the Eurozone) and morally justified and politically courageous (welcoming over 1 millions refugees). Unfortunately, she is now confronting the reality of a changing German electorate.

The strong result by the AfD to the 2017 federal election sends a significant signal that German politics is changing. Populism, which has been present and rising all around Germany and across the pond, finally arrived in Germany. AfD will be a force to reckon with in the legislative process, but could be the necessary evil in order for mainstream parties to craft more substantial social and integration policies.

However, the day ensuing the results, co-chair of the AfD, Frauke Petry, surprised her colleagues by announcing that she will not be part of the AfD group, but will be present as an independent. This announcement illustrates a reality regarding extreme-right parties in Europe. Winning elections has become easier for these parties, like the Front National (FN) of France and even the UKIP party in the UK, able to attract a substantial

Credit: Reuters/Fabrizio Bensch

share of the electorate. But they are unable to maintain unity once elected and even less able to govern. The most striking case is exemplified by the FN arriving, as expected, to the second round of the French elections in front of two mainstream parties, Les Républicains (right) and the Socialist Party (left). Marine le Pen, president of the party and presidential candidate, was correct when claiming that the FN was the largest party of France. However, after losing the second round with a high percentage (33.6%), the party has been dealing with major internal crises and is now almost irrelevant in shaping the debate and agenda. Petry’s announcement seems to prove the point that extreme-right parties grow strong as an opposition force using identity politics and deeply inconsistent policies in order to get elected. But their lack of political consistency and leadership tension affect their abilities to survive, despite stronger results at elections, and therefor to govern.

This elections mark a turning point in German politics and may bode some major difficulties ahead for Merkel. Furthermore, ensuing the election of Macron in May and its legislative majority, the world expected France and Germany to be finally on the same political page in order to advance and reform the EU. Hopefully, Europe will not be the big looser of this election.

(COPYRIGHT 2017 BY POLITIPOND. ALL RIGHTS RESERVED. THIS MATERIAL MAY NOT BE PUBLISHED, BROADCAST, REWRITTEN OR REDISTRIBUTED WITHOUT PERMISSION).

World leaders are gathered in New York for the opening of the 72nd Session of the United Nations General Assembly. This year is quite unique with a series of major unknowns and new players. The 2017 session included the recently elected American president, Donald Trump, and French president, Emmanuel Macron. In addition, the United Nations (UN) is headed by a new Secretary General, António Guterres, trying to make a name for himself. If these players matter, the geopolitical context requires a concrete and thoughtful reflection on its engaging world players on a multilateral basis. Comparing Macron and Trump’ speeches permits one to reflect on the internal forces at play and visions within the liberal order at a time of growing instabilities and complex challenges.

Unknowns Ahead of the 72nd UNGA Session

President Trump was elected in November 2016 on a nationalist platform summed up in his campaign slogan, America first. Trump’s vision of the world is dire, dark and negative, requiring the US to start defending his interests and national security on unilateral basis. Historical alliances, global governance, multilateral institutions and global trade are undermining American interests and supremacy. Trump perceives diplomacy in transactional terms, wherein only the US can win. Months later, in May 2017, on the other side of the pond, Emmanuel Macron won the french presidential race by campaigning on an agenda calling for audacity and grounded on a pro-Europe and pro-multilateralism agenda. Macron’s election was perceived as the end of the populist rise beginning with Brexit and allowing Trump to win the White House. The two leaders met on a series of occasions, the first time at a NATO summit and the second in Paris for the 14 of July. Both men could not be more different, but appear to be developing a relationship.

Ahead of the 72nd session, the future engagement of the US as part of the Paris deal (global fight against climate change), North Korea, the future of the Iranian nuclear deal, and multilateralism at large remain unknown. These four issues are at the center of the global agenda due to a shift in American foreign policy since the election of Trump. Soon in office, Trump called for the departure of the US from the Paris deal and has been more than unclear about the reality of climate change. Interestingly enough, many experts were, positively, surprised by the fact that world leaders remained committed to the Paris deal despite the departure of the US. On North Korea, Trump has escalated the rhetorics, as part of his tweeting war, threatening to unleash ‘fire and fury‘ against North Korea ensuing the launch of intercontinental ballistic missiles. With regard to the nuclear deal with Iran, Trump had used this issue on the campaign trail to undermine diplomacy and multilateralism and Secretary Clinton (whom did not finalize the deal). The Iran deal is widely perceived among conservative and republican circles as a failure, which will undeniably result with Iran becoming a nuclear power. Lastly, on multilateralism, Trump has never shied away from the fact that unilateralism and transactional foreign policy serve better American interests than complex organizations like the United Nations.

In less than a year, President Trump has managed to shape a new narrative about the instability of the international order, in particular the liberal order, and the need for the US to use military might at all costs to advance its interests (i.e. the limited bombing over Syrian and the escalation of the war in Afghanistan).

Trump-Macron Ping-Pong

The speeches of both leaders could not be more at odds. If Trump sees the world and foreign policy as a transaction and through unilateralism, Macron has expressed his support towards multilateralism and global governance. Both leaders made their debut at the UN earlier today and their respective speeches confirm the prior statement.

UN Photo/Cia Pak

President Trump’s speech (here) certainly marks a breakup with his predecessor. Trump opened his address before global leaders with a campaign tone talking about domestic matters (the growing economy, the strengthening American military and American resilience). Trump emphasized at great length the concepts of sovereignty (used 21 times in total including the word sovereign), security, prosperity and power. Regarding the way he sees American foreign policy, he underlined that the US was guided by outcomes and not ideology. “We have a policy of principled realism,” he argued “rooted in shared goals, interests, and values.” Some claimed that this speech demonstrated a return to realpolitik for the US. But half way through his speech, the American president made the following statement, “The scourge of our planet today is a small group of rogue regimes that violate every principle on which the United Nations is based.” These rogue regimes were identified as North Korea and Iran.

On North Korea, Trump used the platform to directly threaten the regime in Pyongyang claiming that the US may have no other option than “to totally destroy North Korea.” The language utilized to describe the members and leader of the North Korean regime was undiplomatic to say that least. He used this part, without mentioning it, to point the finger at Beijing. Ensuing his menace, he said “That’s what the United Nations is all about; that’s what the United Nations is for. Let’s see how they do.” The use of the pronoun ‘they’ in the last clause indicates the disconnect between Washington and the rest of the world. It indicates that Washington has its strategy ready (use of military force), and now the members of the UN can try to find an alternative via diplomacy.

Macron’ speech (here in French) had a totally different tone. His opening sentences emphasized the core ideas, values and norms encompassed by the UN and the desire to design a new system putting human rights at its center (with a natural

UN Photo/Cia Pak

reference to René Cassin). The issues laid out by the french leader consisted of Syria, terrorism (Iraq), Mali (G5 Sahel and MINUSMA), protection of refugees, climate change, nuclear proliferation, multilateralism, and the reform of the UN (less bureaucratic and more active).

On climate change, President Macron directly responded to President Trump by expressing absolute opposition to renegotiating the Paris deal. On nuclear proliferation, Macron expressed deep concerns with the way North Korea behaves on the international stage, but rejected Trump’s reference of the Iranian deal as a bad one.

If Trump’s narrative was centered around the theme of sovereignty, the structure of Macron’s address was organized on the idea of France’s ability to hear the voices of the weakest and defending their rights and empowering them by speaking for them. Through the emphasis of voices, Macron presented France as a guardian of the weakest with French national interest being directly intertwined with global security. In reading and analyzing Macron’ speeches (for instance with his recent speech in Athens), one can identify a series of commonality: bringing France into the sphere of superpower (at least in rhetorics); similitude with an Obamaesque style of narration; deep reference and understanding of history; and a bold and global call for audacity. This style certainly breaks with the recent past of addresses of French presidents (in particular Sarkozy and Hollande) and re-unites France, for better or worst, with its gaullo-mitterrandist heritage.

Concluding with Secretary General Guterres’s comments seems appropriate. “We are a world in pieces. We need to be a world at peace.” The antipodal addresses of the American and French leaders illustrates a clear split within the West about framing critical menaces, developing a cohesive strategy, and ultimately shaping world affairs. The transition from rhetorics to actions, if any, will be fascinating to observe.

(COPYRIGHT 2017 BY POLITIPOND. ALL RIGHTS RESERVED. THIS MATERIAL MAY NOT BE PUBLISHED, BROADCAST, REWRITTEN OR REDISTRIBUTED WITHOUT PERMISSION).

Has populism disappeared from Europe? Is the European Union finally perceived as a constructive actor in Europe? Where are the reflections on regional crises affecting the unity of the EU and the security of the member states (MS)? All these questions seem to have disappeared from the national and European agendas since the election of Emmanuel Macron at the helm of France. Unfortunately, the malaise within each MS of the Union remains unchanged and ought to be analyzed.

On the question of the European Union, the debate about the role of the Commission will re-emerge with the next appointment of the President in 2019 and the next rounds of trade agreement with Japan. One core lesson that is often forgotten is the centrality of the MS in the decision-making process of the EU. The integration of the Union, either deepening or widening, cannot occur without the agreement and consent of the MS. If European technocrats and experts on the EU are aware of this fact, a wide majority of Europeans still tends to be unaware or even doubt this reality. Many cases in recent years, beginning with the Greek debt crisis leading to a referendum opposing the terms of the bailouts, which was then rejected by Prime Minister Tsipras, followed by the Austrian elections in May/November 2016, then the Brexit vote in June 2016, and the radicalization of new MS like Poland and Hungary, illustrate this popular opposition against the integration process and the EU at large.

The commonalities among all these cases are: regain of national sovereignty, protection of national identity, and quest to increase national power over European forces. The argument has usually been MS versus the EU. However, opening up the black-box of each MS, one can identify a much more nuance and complex picture. Within each MS, a division between cosmopolitanism (usually cities) versus nationalism (usually rural and post-industrial regions) is dividing countries politically and culturally speaking. The domestic split existed before 2016, but the financial crisis leading to an anemic economic growth across the Union exacerbated the split.

However, since the ‘positive’ outcomes of the Dutch and French elections, one could be fooled believing that the cultural-identity split dividing MS and the Union has disappeared. For many the election of Emmanuel Macron at the helm of French presidency stopped the populist wave. Such statement is certainly false considering the current domestic tensions in Poland with the push for constitutional reforms undermining the independence of the judiciary and in Hungary with the continuous anti-democratic efforts. The response of the Commission to potentially trigger Article 7 to sanction Poland is the proper approach enforcing the Copenhagen Criteria. However, the lack of clear support by Paris and Berlin to sanction Warsaw sends a mix message of unity and support of the rule of law in the EU.

The current Brexit negotiations are as well an important matter for the future of the EU and the relationship with the UK. Even though the departure of the UK from the Union is a disappointing event, it is an important historical lesson for Europeans. At this point, it would be a mistake for the EU to appear weak in the negotiations by not reaching a complete departure of the UK from the Union; Brexit ought to occur. In the UK, there are already surges of unhappiness towards the ruling class with the recent domestic talks of a potential remaining of the UK in the Union. It would play against the EU to keep the UK at this point of time. Despite a close majority of pro-Brexit votes winning the non-binding referendum, the EU needs to move along and finalize the exit of the UK. In addition, the EU needs to remain strong in enforcing rule of law and global norms. If the rumors of ongoing US-UK negotiations, as advanced by the American president, regarding a comprehensive trade agreement between the UK-US to kick in as soon the exit is completed, were to be true, the EU needs to escalate the matter. It is in the interest of the EU to enforce its global standing as the trade negotiator for the 28 Member States. The credibility of the EU as global actor is at play and should not be undermined by neither the UK nor the US. The 27 remaining MS need to support such action in case ongoing trade talks between London and Washington were to be accurate.

The domestic political tensions have distracted from the broader question of furthering the integration of the EU. The Eurozone crisis has highlighted the limitation of an integration à la carte and incomplete integration process in fiscal and economic matters. President Macron was in recent time the most pro-European candidate centering his agenda around the need to foster EU integration. Now in power, President Macron may back down from its EU centric agenda. But the EU needs to maintain the momentum in pushing for deepening the integration process in fiscal and economic issues as well as in defense policies.

(COPYRIGHT 2017 BY POLITIPOND. ALL RIGHTS RESERVED. THIS MATERIAL MAY NOT BE PUBLISHED, BROADCAST, REWRITTEN OR REDISTRIBUTED WITHOUT PERMISSION).